What would you do...financially?

[Svnla]

Saw this yesterday on PBS = http://www.pbs.org/wnet/need-to-kno...y-27-2012-living-on-the-financial-edge/14302/

It is about 25 minutes long but you can skip to 7:50 to get to the data. Back story, single mom who is unemployed with 2 boys, one is working and one is not. They live in NJ in a subsidized 2 beds apartment. Their total income is about $2915 per month (unemployment check and security job). They have $10 at the end of the month and that would be a good month.

Here is what I would do = I would cut car expense down by using bus/train/bike. Cut back or eliminate credit card usage. No parking fee by using bus/train/bike. Open a checking account for $10 a month fee or less. Cut cable, only internet and use prepaid cellphones. Cut gym membership by YMCA or workout at home/park. Cut back or eliminate entertainment. Get rid of the cat.

Also, the youngest boy needs to get a job, anything to bring income. Same for mom. Extra jobs for everyone to bring more income. Also, older boy needs to finish school to have a better job.

We do need to have basic finance class in school. What would ATOTers do if you are them?

Details below: $2915 income per month

405 rent for 2 beds apt
315 food
40 laundry
734 car expenses/insurance
658 credit card/hospital/student loan
165 parking
42 check cashing fee
280 cable, internet, phone
181 gym, shoes, gift, entertainment
50 cat food and liter
30 loan for medicine
1.5 coffee
1.5 mother day card
2 lottery ticket
2905 TOTAL EXPENSE

 

[dud]

Wouldn't it be nice ... if we could all live within our means? There was a time when the Government did not provide the amount of "welfare" that they do now.

 

[NoStateofMind]

{warning didnt watch video}

Cut down to one car save 350
Get a bank account and save 42 a month on check cashing
Get rid of the cats another 50
cable phone and internet needs to be cut. NOt totally but around the 150 range
use bus and save parking fees 165

 

[Fingolfin269]

Wow car expense (and I mean this relatively speaking of course).

 

[jlee]

405 rent for 2 beds apt <- wow, cheap
315 food <- eh
40 laundry <- eh, if no W/D in unit, can't do much
734 car expenses/insurance <- holy shit, I have three cars and pay half that
658 credit card/hospital/student loan <- ouch, pay less to hospital and more to CCs
165 parking <- find alternative
42 check cashing fee <- get a bank account
280 cable, internet, phone <- Drop cable, basic cell phone plans
181 gym, shoes, gift, entertainment <- Cancel gym memberships...SHOES? for srs?
50 cat food and liter <- For one cat, it should cost half that
30 loan for medicine
1.5 coffee
1.5 mother day card
2 lottery ticket <- stop that too
2905 TOTAL EXPENSE

 

[Corporate Thug]

I didn't watch the video but my car payment (07 Ford Fusion) + insurance = $370/mo...my parents' internet + TV + phone package = $99/mo

That's a $600 difference already.

 

[NoStateofMind]

Wouldn't it be nice ... if we could all live within our means? There was a time when the Government did not provide the amount of "welfare" that they do now.

Its hard to succumb to the harsh reality that you can no longer afford the lifestyle you have been living for however long. With that lifestyle comes a sense of entitlement. That's truly the underlying problem in society today.

 

[UglyCasanova]

1.) Sell car, buy cheap beater and drop comprehensive insurance until you can work your credit card/student loan bills down

2.) Get rid of cable, it's a luxury. If they only have $10 at the end of the month they can't afford it, sorry. Learn to use the library.

3.) Get rid of the gym membership. Learn to run and do pushups, you get the exercise and it's free.

 

[goog40]

You know any reduction in spending they make is just going to be replaced by more lotto tickets and other pointless expenses.

 

[Pr0d1gy]

I'm calling shens, no power bill?

 

[halik]

Saw this yesterday on PBS = http://www.pbs.org/wnet/need-to-kno...y-27-2012-living-on-the-financial-edge/14302/

It is about 25 minutes long but you can skip to 7:50 to get to the data. Back story, single mom who is unemployed with 2 boys, one is working and one is not. They live in NJ in a subsidized 2 beds apartment. Their total income is about $2915 per month (unemployment check and security job). They have $10 at the end of the month and that would be a good month.

Here is what I would do = I would cut car expense down by using bus/train/bike. Cut back or eliminate credit card usage. No parking fee by using bus/train/bike. Open a checking account for $10 a month fee or less. Cut cable, only internet and use prepaid cellphones. Cut gym membership by YMCA or workout at home/park. Cut back or eliminate entertainment. Get rid of the cat.

Also, the youngest boy needs to get a job, anything to bring income. Same for mom. Extra jobs for everyone to bring more income. Also, older boy needs to finish school to have a better job.

We do need to have basic finance class in school. What would ATOTers do if you are them?

Details below: $2915 income per month

405 rent for 2 beds apt
315 food
40 laundry
734 car expenses/insurance
658 credit card/hospital/student loan
165 parking
42 check cashing fee
280 cable, internet, phone
181 gym, shoes, gift, entertainment
50 cat food and liter
30 loan for medicine
1.5 coffee
1.5 mother day card
2 lottery ticket
2905 TOTAL EXPENSE

My 911 runs me less a month, all in; WTF are they driving? Same thing for cable/internet/cell (80+70).

Also unemployed mom with 2 kids has no money for a pet.

 

[Svnla]

First of all, the unemployment check for the mom is about to run out, so they will be even deeper trouble very soon.

Dud &#8211; true, I think they are ignorant financially.
PC Surgeon &#8211; IIRC, they only have 1 car (Honda). The older son rides a bike to work.
Fingoldfin &#8211; yup, that is a lot of money for vehicle expense.
Jlee &#8211; they live in a subsidized place with all utility bills (water/electricity/heat/ect.) included.
Corporate &#8211; I am not sure why the car expense is so high, and that does not include the parking fee
Casanova &#8211; yup, your suggestion is about the same as mine in the op.
Goog &#8211; sadly, but I think you are correct.
Prodigy &#8211; see my reply to jlee.
Halik &#8211; see my reply to Fingoldfin.

Here is my detail break down (based on my own experience):

405 rent for 2 beds apt => can&#8217;t cut here, good deal. Saving = $0
315 food => not sure it can be cut as long as they cut the fat/junk food. Saving = $0
40 laundry = >good deal for 3 people. Saving = $0
734 car expenses/insurance => cut, cut, and more cut. Eliminate the car if need be. Saving = at least $500 to $600
658 credit card/hospital/student loan => too much on CC expense, cut it totally. Saving = at least $200
165 parking = >no more car, no more parking fee. Saving = $165
42 check cashing fee => open checking account, even with low balance, it would cost about $10 or less per month. Saving = at least $30
280 cable, internet, phone => $30 for DSL, two prepaid phones ($40 x 2) = $80. Saving = $170
181 gym, shoes, gift, entertainment => YMCA or park/home gym. Saving =$180
50 cat food and liter => no cat. Saving = $50
30 loan for medicine = > can&#8217;t cut here
1.5 coffee => small change
1.5 mother day card => small change
2 lottery ticket => small change
2905 TOTAL EXPENSE ===è down to $1610, a saving of $1295 at least.

Also, what the heck she has been doing for the last few months? No side job to bring in extra income? Younger son needs to get up and get a job or two. Everyone in the family need to cut back expense and bring in income. They did try to cut expense but not eating lunch and not taking medicine are penny wise and pound foolish.

Basic personal finance: Income > expense = good. Vice versa = bad. Not very complicated or difficult.

 

[nanette1985]

Public transportation in NJ is horrible. It's all designed to get you to & from NYC. Getting rid of the car and relying on public transportation is not an option in Newark unless the only place you ever go is Manhattan. And if she's in Newark, car insurance is going to be expensive. And safe parking isn't cheap. And with NJ cops in extreme revenue enhancing mode, tickets are plentiful and unescapable.

She probably can't get a bank account because of chxsystems. she's pretty erratic with her finances, she probably doesn't have a good record there.

Also, if you've never been desperately poor, you don't know that when you
have a check and need the cash right away, you need that check cashing service

Yeah, get rid of cable and do prepaid phones -if she can scrape together enough money to get enough phone service.

Keep the credit cards current - for poor people credit is the only source of emergency money.

Totally agree that the main thing she needs is financial literacy.

 

[venkman]

1.) Sell car, buy cheap beater and drop comprehensive insurance until you can work your credit card/student loan bills down

2.) Get rid of cable, it's a luxury. If they only have $10 at the end of the month they can't afford it, sorry. Learn to use the library.

3.) Get rid of the gym membership. Learn to run and do pushups, you get the exercise and it's free.

Number 1 is easier said then done. To get that high of a payment, they probably signed for a high APR predatory loan and are now underwater on their car. Even if they could sell it and break even, they don't have the cash reserves to buy a used car and they no longer have enough credit to get anything but a crazy interest rate on a used car loan. My guess is that they live in less than ideal neighborhood so their insurance rates are going to be sky high as well.

I agree with number two, they have to get out from under the cable and cell phone bills.

I think the biggest thing they can do is get the other son working. The working son has to skip lunch during his work day because he can't afford it and the other other son thinks he can just be a non-contributing member? HECK NO! My guess is that he doesn't work to keep the family income low enough to qualify for the stuff they do qualify for (food stamps, public assit. housing, etc) and his income would be mostly or completely gobbled up by the cost of living increase. If that's the case, I would expect him not to work.

 

[ElFenix]

I didn't watch the video but my car payment (07 Ford Fusion) + insurance = $370/mo...my parents' internet + TV + phone package = $99/mo

That's a $600 difference already.

'car expenses' probably includes gas and maintenance.

 

[Baked]

I learn to mind my own business and not worry or offer assistance in dealing with other people's finance business. The mom with 2 fucking children should know by now how money works and what's priority and what's not. You don't need people's help on how to spend your money, seriously.

 

[Lifted]

$734 - car payments
$165 - parking
$280 - cable/internet/telephone REALLLLLLLLYYYYYY???? when you're getting government subsidized housing - 2 bedroom at $450/month - you spend this much on boob tube!?!?!?!? prepaid cellphone is what, $35/month. Go to the library if you want internet access. $5 for rabbit ears.

That's $1,179/month - $14k/year they are pissing away while on Section 8. $1k - $2k year for all of them on public transit (they live in Newark for crying out loud). That could probably include a few taxi trips as well).

W.T.F.

I'm thinking mandatory financial counseling and classes for all people on long term subsidized housing is in order.

 

[SlitheryDee]

Gt rid of the cat. Start working out at home. Stop buying lottery tickets. I know it's only 2 dollars, but when your margin for error is 10 dollars that seems a lot more significant. Get rid of cable television. Sell the cars. Start using public transportation.

Hell all that cuts over $1000 off of their monthly budget. If the youngest son got a job bagging groceries or something they'd be living large.

 

[chusteczka]

The money problems of stupid people with their excess spending and other poor financial decisions should not be my problem. Welfare needs to be ended. They live better than I do and spend far more than I do. Yet I am self-sufficient while they are not.

 

[Corporate Thug]

'car expenses' probably includes gas and maintenance.

still doesn't add up IMO (I don't know what kind of car they have, but you can get a cheapo car for $200 a month...insurance and other expenses shouldn't be $500+/mo

EDIT: the video shows the mom? driving a newish Honda Accord...not the cheapest car on the block.

 

[Corporate Thug]

I'm watching the video and one of the family members says he skips up on lunch to save money at work....how much does it cost to make a PB&J sandwich again?

 

[thedarkwolf]

Getting rid of the cat is messed up lol. Getting rid of the cat pretty much means killing the cat. Adult cats have almost no chance of being adopted. I'm betting you get rid of the cat people don't have pets. The $50 to keep one of their family members alive a month is one of the smallest of their expenses. Its the gym membership, car, and cable/phone/internet that are the dumbest and need to go or at least be cut way back on.

 

[GasX]

734 car expenses/insurance
165 parking
42 check cashing fee
280 cable, internet, phone

1. Buy a fucking cheaper car
2. Park on the street
3. Learn to get your checks cashed for less
4. $280? They running a fucking server farm and calling china 5x day???

Cutting hard on these 4 items can reduce expenses by up to a third. That's $1000 month to start spending on more lottery tickets...

 

[jagec]

50 cat food and liter => no cat. Saving = $50

All of your other recommendations were solid without being overly draconian, but I don't really understand why everyone is saying to get rid of (which, let's be honest, usually amounts to "let a shelter put down") the cat. The real problem here isn't the cat per se, it's the amount of money that they are SPENDING on a cat.

Buy decent-quality dry food, a refillable litter bucket at Petco, and a scoop. Suddenly your expenses went from $50/month to less than $10/month. Chump change, no reason to get rid of a family pet.

They are probably feeding it expensive wet food, and maybe they're one of those families that don't scoop the litter, they just throw it away.

 

[PlasmaBomb]

Saw this yesterday on PBS = http://www.pbs.org/wnet/need-to-kno...y-27-2012-living-on-the-financial-edge/14302/

It is about 25 minutes long but you can skip to 7:50 to get to the data. Back story, single mom who is unemployed with 2 boys, one is working and one is not. They live in NJ in a subsidized 2 beds apartment. Their total income is about $2915 per month (unemployment check and security job). They have $10 at the end of the month and that would be a good month.

Here is what I would do = I would cut car expense down by using bus/train/bike. Cut back or eliminate credit card usage. No parking fee by using bus/train/bike. Open a checking account for $10 a month fee or less. Cut cable, only internet and use prepaid cellphones. Cut gym membership by YMCA or workout at home/park. Cut back or eliminate entertainment. Get rid of the cat.

Also, the youngest boy needs to get a job, anything to bring income. Same for mom. Extra jobs for everyone to bring more income. Also, older boy needs to finish school to have a better job.

We do need to have basic finance class in school. What would ATOTers do if you are them?

Details below: $2915 income per month

405 rent for 2 beds apt
315 food
40 laundry
734 car expenses/insurance
658 credit card/hospital/student loan
165 parking
42 check cashing fee
280 cable, internet, phone
181 gym, shoes, gift, entertainment
50 cat food and liter
30 loan for medicine
1.5 coffee
1.5 mother day card
2 lottery ticket
2905 TOTAL EXPENSE

Hang on I just watched the video...

Income
1160/mo Unemployment benefits
1640/mo Andre's job
115/mo Food stamps

Utilities are $80/month

The lady said that rent was $325/mo, and the show states rent + utilities are $405/mo.

Car is the Mothers, who is unemployed...

They have 2 cats.

A collection agency is also after Andre for not paying the loan on his computer. So really they are financially negative at the end of the month rather than +$10.

That loan is 29% APR, which he doesn't understand and just gave up paying because the bill was getting bigger...

They also keep running into "unexpected" bills like car maintenance the previous month, vet care for their animals ($238 this month), medical care for the family (Juanita's skipping some of her meds because they can't afford them).

Next month Juanita's unemployment benefits run out.

She says that she would take a cleaning job if they paid $10/hr, and that if it came to it she would cut her cable...

The finance advice centre managed to get the to drop insurance on their loans to save money and open a bank account.